Question

In Australia, what are the current laws with regards to shareholders' rights and activism on environmental social governance issues such as gender inequality especially in listed public companies (ASX300)? In particular what laws or guidelines enable major ASX300 shareholders, for instance, Australian Super to exercise their right to vote against the re-election of all-male boards.

Please answer promptly

subject Business law

Answer 1

Environmental, social, and governance (ESG) criteria are an increasingly popular way for investors to evaluate companies in which they might want to invest.

Gender equality - Westpac

We were the first bank to publicly commit to achieving an aspirational target of 50% of our leadership roles to be held by women, which we achieved in 2017. We are proud to have reached gender equality in leadership roles in our 200th bicentenary year; and our 'women in leadership' target of 40% for General Managers in 2017.

How we're empowering women

Policies

• Paid parental leave: In 1995, we were one of the first publicly-listed companies in Australia to provide paid parental leave and in 1998, first to provide paid partner leave. We were also the first private sector company to pay superannuation on unpaid parental leave in 2010
• Flexible working: All of our people can choose from a range of flexibility options to suit work and personal needs
• In 2016 we were the first bank to make it a standard operating procedure to recognise a customer’s paid parental leave and return to work income in their borrowing capacity for home lending

Leadership

• We have mandated that there should be 50% women on recruitment shortlists for all leadership roles
• We have also mandated that 50% of high potential program and graduate program participants be women
• In 2008, we were the first of Australia's big four banks to be led by a female CEO
• We are recruiting female talent with transferable skills from non-financial industries through our Equilibrium Program
• Our internal Women of Influence Awards program recognises our own female employees who are making an outstanding contribution to our business, customers and local communities.

Training and development

• We offer a wide range of training programs to help women with their career development
• We were the first bank to dedicate a unit specifically to the success and development of Australian women through the Ruby Connection website.

Recognition

• We have received the Employer of Choice for Gender Equity Citation (awarded by the Workplace Gender Equality Agency) every year for over a decade
• We won Employer of the Year at the 2016 Women in Banking and Finance Awards
• We are ranked as the leading Australian bank in the 2017 Bloomberg Financial Services Gender Equality Index.

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The Workplace Gender Equality Agency is an Australian Government statutory agency created by the Workplace Gender Equality Act 2012.

The Agency is charged with promoting and improving gender equality in Australian workplaces.

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About the Workplace Gender Equality Act

The Workplace Gender Equality Act 2012 (Act) replaced the Equal Opportunity for Women in the Workplace Act 1999. The legislation aims to improve and promote equality for both women and men in the workplace.

The principle objects of the Act are to:

• promote and improve gender equality (including equal remuneration between women and men) in employment and in the workplace
• support employers to remove barriers to the full and equal participation of women in the workforce
• promote, amongst employers, the elimination of discrimination on the basis of gender in relation to employment matters (including in relation to family and caring responsibilities)
• foster workplace consultation between employers and employees on issues concerning gender equality in employment and in the workplace
• improve the productivity and competitiveness of Australian business through the advancement of gender equality in employment and in the workplace.

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Retail shareholders focussing on ESG issues have typically been the most prominent activists in Australia. Whilst such shareholders have always been active in Australia, in recent years there has been a spike in the number of shareholder requisitioned resolutions being proposed in relation to ESG issues.

Economic activism by institutional shareholders is also becoming increasingly prominent in Australia. Although forms of economic activism are not new in Australia, Activist Insight data suggests that there was a 10% increase in Australian listed companies facing activist Board-related demand in the 12 months ending 5 April 2019 (as compared with the prior corresponding period). This has been driven by a mix of onshore and offshore institutional investors.

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Australia's peak super investment body recommend its members vote against the re-election of company directors who sit on boards with no women.

The Australian Council of Superannuation Investors, which represents $450 billion in assets on behalf of more than 8 million Australian super fund members.

ACSI has progressively ramped up its stance on women on boards, vowing to take action to reject the re-election of directors who sit on male-only boards.